Filed Under:Claims, Catastrophe & Restoration

Disaster-mitigation programs targeted by Trump shown to reduce future costs

The NIBS found that every $1 the federal government spends on mitigation projects reduces future costs by an average of $6.

(Photo: Bloomberg)
(Photo: Bloomberg)

(Bloomberg) -- Federal programs to protect Americans against extreme weather and other natural disasters save even more money than previously thought, according to a report funded by the same agencies that have proposed cutting many of those programs.

The report, released Thursday by the National Institute of Building Sciences, found that every $1 the federal government spends on so-called mitigation projects, such as elevating homes at risk of flooding, improving stormwater management systems or strengthening buildings against earthquakes, reduces future costs by an average of $6.

Growing effects of climate change?

That’s higher than the 4-to-1 savings the institute last estimated in 2005; the increase reflects the growing effects of climate change as well as better data and measurement, according to the group.

Related: Big insurers brace for perilous future as climate risks escalate

"Invest properly in mitigation, you’re going to get your money back — regardless of what your beliefs in climate change are," Bryan Koon, chairman of the institute’s Multihazard Mitigation Council, which prepared the report, said in an interview.

Proposals to cut programs

Trump’s first budget request called for cutting many of the programs designed to protect Americans from the effects of climate change. He and some of his cabinet members have questioned the science of global warming, rolling back many of the programs and regulations established by President Barack Obama to reduce greenhouse gas emissions.

Yet 2017 went on to become the most expensive year on record for natural disasters, with $306 billion in damage and 362 deaths in the U.S. led by hurricanes in the southeast and wildfires in the west. The results have drawn scrutiny to whether the government does enough to prepare for those disasters, especially as much of Puerto Rico remains without electricity. And they have focused new attention on the costs of those disasters to federal taxpayers, not least from Republicans in Congress, and how to reduce those costs.

Related: Trump disbands group that prepared cities for climate shocks

"The timing couldn’t be better for people to recognize the importance of mitigation," said Koon, who left his job as Florida’s director of emergency management last year and now works for IEM Inc., a security consulting firm. He said the report provides "plain hard facts and figures that appeal to anybody in Congress, in the executive branch."

Roy Wright, the official in charge of insurance and mitigation for the Federal Emergency Management Agency, said his organization had urged the building institute to "revisit" the 4-to-1 ratio it first calculated in 2005, "to make sure this assertion we’re making about the power of resilience is well-founded." He said in an interview that the revised figures demonstrate that federal spending on mitigation is "an even more powerful investment" than people knew.

Importance of spending money before a disaster

Wright also noted that FEMA Administrator Brock Long, who took office after the budget request was submitted, has repeatedly emphasized the importance of spending money before a disaster.

The institute was created by Congress in 1974 and six of its 21 board members are presidential appointees. Career staff at FEMA, U.S. Department of Housing and Urban Development and the Economic Development Administration helped work on the report and review its findings, according to the institute. Those agencies were also the lead funders while contributions were also made by the International Code Council, the National Fire Protection Association and the American Institute of Architects.

Report aims to help federal officials make better decisions

The report examined 23 years of data showing the costs and benefits of federal mitigation grants from FEMA, HUD and EDA. Those grants, which totaled $27 billion in spending, led to an estimated $158 billion in benefits, including $68 billion in avoided deaths and injuries, $58 billion in avoided property damage and $13 billion in avoided costs associated with additional living expenses and direct interruptions to businesses.

Related: 12 ways the U.S. is using nature to protect against natural disasters

Henry Green, the president of the institute, said he’s under no illusions about the ideological debate around climate change. But he said he hopes the report’s findings helps federal officials make better decisions about when and how to spend money on the types of events that climate change is exacerbating.

"If you’re not open to looking at new data that is validated, then you very much may not accept what is going on here," Green said in an interview. Still, he said, the cost savings from mitigation programs "is not something that we dreamed up. These are fact-based numbers that are gathered through government agencies."

Indications administration has softened stance

The Trump administration’s first budget request would have cut by half FEMA’s pre-disaster mitigation grants to cities and states. It would have ended HUD’s Community Development Block Grant program, the vehicle Congress uses to deliver large chunks of disaster-recovery money. And it would have eliminated EDA, a division of the Department of Commerce that runs disaster programs.

There are indications that the administration has since softened its opposition to some of those programs.

HUD spokesman Brian Sullivan said the department "contributed to the research because we thought it would add to the knowledge base on the cost and benefits of mitigation." He declined to comment on whether the report’s findings had changed the views of HUD’s leadership about which programs to fund.

But Sullivan noted that the administration asked Congress for $12 billion in additional disaster funding through the Community Development Block Grant program at the end of last year to pay for resilience programs.

Asked if it was fair to conclude that administration’s position on mitigation programs had evolved, FEMA’s Wright responded, "That seems reasonable."

Related: 10 U.S. cities with the highest & lowest natural-disaster risk level

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